Abstract

The iron ore supply chain connects producers, consumers and logistics providers. The overall objective of the robust management process of such supply chain is to continuously have the right quantity of material in the right place, at the right time and at the right quality despite the presence of disturbances. Yet this apparent simplicity leaves miners wondering why it is so difficult to achieve and sustain.

Iron ore companies from all around the world experience lack of visibility through the interdependencies (from pit to port) of the supply chain, multiple versions of the truth, poor planning capacities caused by the incapacity to run satisfactory "what if" scenarios, data inaccuracy and inadequate reporting of the right KPIs. This greatly increases the cost of operations through quality penalties from delivering incorrect material or demurrage costs that result from material shortages.

One important root cause for these operational inefficiencies not to mention resentment from all stakeholders is the industry’s heavy reliance on legacy systems involving poorly managed spreadsheets with little or no integration to third-party software. Such integration gap, resulting from an incomplete digitalization, creates a broken data flow that does not empower the right person with right information at the right moment to take the right action. Moreover, such mixtures often fall short in fully catching up with the distinctive features of the mining operations.

This presentation uses illustrative case studies to illustrate how the integration gap leads to poor practices in planning, scheduling, and accounting of material movements. Alternatively, solutions paths are presented to show what is needed to achieve the best operating practices as well as compliant production accounting.